Here is an example of the monthly home value report you’ll receive:
Home Seller Information
Many of you reading this are facing difficult decisions in the current housing market. Everyone’s situation is a little different; but for the most part sellers in the current market have found themselves owing more on their homes than they are currently worth. Of course there are some people that paid cash or put large down-payments on their homes (or purchased prior to the housing boom) that still have equity. Either way, the current home values are down throughout the nation, and Las Vegas has been one of the hardest hit areas.
That being said; you should also know that there are a large number of buyers that have been rushing to the Las Vegas housing market since 2009. These buyers are comprised of investors (many of them using cash to buy), first time buyers (many taking advantage of the low rates and 3.5% down FHA financing), and a number of other buyers that are just taking advantage of the drastic drop in home prices here in Las Vegas. They have seen prices fall more than 60% in most areas of Las Vegas, many have realized the bottom has come and they want to catch the wave early before the values start heading back up. As of 2012 we’re already seeing an increase in the prices, bidding wars, and major inventory shortages. At the time I’m writing this, we have less than a 3 week supply of foreclosure homes on the market (which means if no new foreclosures are listed, we would have zero foreclosures in less than 3 weeks). We haven’t been down this low on inventory since the last major boom. The difference this time is that the inventory is being artificially restricted due to changes in Nevada foreclosure law (AB284), which has made the foreclosure process very difficult for the mortgage companies that have homes in default. However, the mortgage companies will be moving forward with Judicial foreclosures soon. The process may take some time to bring into fruition, but eventually Nevada will likely have a number of judicial foreclosures taking place. This could be a strong incentive for homeowners to short sale if they’ve been living in their homes without paying their mortgage for a while. If their mortgage company decides to pursue a judicial foreclosure, many believe the likelihood of requesting a deficiency judgement for the negative balance will increase exponentially. Whereas with a short sale, you have a lot more negotiating strength because you’re helping the mortgage company voluntarily mitigate the loss by finding a buyer, taking care of the property, and saving them the extra expenses involved in the foreclosure process.
Now that we’ve covered the positives & negatives of the current market, let’s discuss the hot topic of Short Sales. As you may or may not know, the meaning of a short sale is when you owe more on your mortgage than your property is currently worth, and you need to sell that property without being able to pay off the outstanding mortgage balance. Many homeowners throughout the Las Vegas valley are in this type of situation, so short sales have been one of the most common types of listings we see in the current market. It’s basically the same process as a traditional sale; however once you have an offer you will need to send a Short Sale Package along with the offer to the mortgage company (each mortgage company that has a loan on your property, if you have multiple mortgages). As you may have heard this process can be very time consuming with certain banks due to the overwhelming number of homeowners seeking short sale approvals nationwide. They vary anywhere from 15 days to well over 6 months depending on your mortgage company and how skilled of a short sale negotiator your Realtor is. There are plenty of techniques that experienced short sale agents use to speed this process up, but ultimately it’s up to the bank to review & approve the file before the sale can be completed. Very few agents have a track-record with short sales since they are still somewhat new to the main-stream real estate community (they basically began to trickle into the housing market around late 2007). However, they have been around for years, and I remember working with them in the late 90’s after all the naval base closures in California. The banks are finally starting to catch up with their internal processing systems for short sales and we’re seeing drastic improvement in processing times with many of the banks. Eventually they’ll have better systems and the demand should slow down significantly as the percentage of troubled homeowners make their way through the system (either by short sale, foreclosure, or loan modification). I’ve created a detailed section for Short Sales, so you will be able to find more detailed information about the process, what you need, what the ramifications are, tax implications, short sale vs. foreclosure, HAFA, etc.
I hope the information is helpful. Since the short sale process is constantly evolving some of the information may change minutes after I write this, however I work very hard to stay on top of the current changes so I can provide you more up to date information when we meet.